Washington gridlock harming agribusiness

OLIVIA, Minn. — Political gridlock in Washington is taking an economic toll on farm country, representatives of agricultural businesses in Renville County in Minnesota told U.S. Senator Amy Klobuchar, D-Minn., during a stop Jan. 14 in Olivia, Minn.

The lack of a farm bill has forced Corn Capital Innovations of Olivia to put decisions on expanding its staff on hold, Joel Mathiowetz, director of growth with the consulting and risk management company, told the senator. He said it’s hard to invest in additional staff when there is so much uncertainty.

Mathiowetz says rural areas are struggling with a “brain drain” as young people leave for opportunities in urban areas. The uncertainty about farm policy makes it all the harder to recruit and retain talented young people. “It’s a bigger challenge than I ever imagined it would be,” Mathiowetz says.

Although there is capital available, businesses are hesitant to invest when so many uncertainties exist about the federal deficit and budget, says John Baumgartner, president of Baumgartner Environics of Olivia, an environmental products company for agriculture. He said the “lack of a clear and long-term fiscal policy” is a bigger impediment to business development than taxes.

Klobuchar says she is disappointed by the action to extend the farm bill into this year, and to not approve a new five-year bill.

She holds out some hope.

There is the support needed in the Senate, and its version of the farm bill offers $24 billion in deficit reduction. The importance of agricultural exports to the national economy and keeping rural America on a consistent course are understood in Congress, she says.

The senator says she thinks these selling points — and the pressure of the looming debt ceiling limit — may still make it possible to get a bill through the House.

Her Renville County hosts also thanked the senator for her role in fending off attempts to end the federal sugar program, but asked if future challenges are coming.

Klobuchar says the sugar industry needs to reach out and make its case for the jobs and economic benefits provided by the program. “I still feel we should hang in (there). I am more concerned about the overall farm bill,” she says. If a farm bill can be passed, she believes it will retain the program.

Continuing the tour

On Jan. 15, Klobuchar made her first visit to Minnesota Soybean Processors and toured the soybean crush facility and biodiesel refinery, and then met with the cooperative’s board of directors to hear about the board’s ongoing discussions to expand the Brewster facility by adding a $10 million glycerin refinery.

The Agriculture Utilization Research Institute of Marshall recently helped fund a feasibility study on the market for refined glycerin. Taryl Enderson, MnSP general manager, says there is much more work to be done before a decision is made to advance the project.

The region’s soybean producers have benefited by capitalizing on the value-added ventures of MnSP, but as MnSP board member Mike Zins was quick to point out, energy legislation that has to be addressed year after year is a hindrance to proposed expansion.

“As you put these things in place with regard to the farm bill, energy, ethanol and biodiesel, you got to remember when you set up a plant like this, it’s not set up….”

“For one-year increments?” Klobuchar finished. “I know. If we could somehow get our courage up to get a debt deal done … then I truly believe energy and immigration reform are probably the two issues where we could get some bipartisan consensus.

“We need to push an energy vote for a longer term instead of year to year to year, which is so damaging not just for you guys, but for wind, solar — everyone involved in this,” Klobuchar adds.